New Taipei real estate deals slow in Q2

The China Post news staff--The number of real estate transactions in New Taipei City decreased in the second quarter as the industry prepared for the implementation of the luxury tax, but prices continued to rise, government statistics have shown.

Second-quarter transactions registered with New Taipei City's land authorities were 12.4 percent fewer than those in the previous quarter and 20.8 percent fewer than those in the same period last year, according to the data.

The city's Bureau of Land Administration said the decreases were most obvious in Linkou and Sanxia districts where speculative trading had been active before the luxury tax was introduced. The tax, which was introduced in June to curb speculative trading, deterred buyers and prompted developers to delay new projects, the bureau added.

The bureau explained that after the government unveiled the draft for the new tax towards the end of February, real estate transactions slid drastically in April.

Transactions rebounded in May ahead of the implementation of the tax, only to start falling again in June, the bureau said.

But real estate prices rose slightly in the second quarter, as interest rates remained low and the housing market still offered chances of good investment amid inflation, the bureau noted.

Ongoing infrastructure development in the city, such as the airport express train, is also keeping housing prices afloat, the bureau said.

The city's tax bureau said the number of transactions it recorded between April and July decreased by almost 10,000 cases compared to the same period last year, and the resulting decreases in tax revenues topped NT$100 million.

Meanwhile, real estate agents said housing prices in Taiwan may fall slightly in the wake of the recent woes in the financial markets.

Some investors in the stock market may need to sell their properties in order to obtain capital, the agents explained.

But the housing market remains relatively stable, they said. During the financial crisis in 2008, Taiwan's stock market slumped 50 percent, but housing prices in Greater Taipei only decreased about 10 percent, the agents noted.